THE NUMBERS DON’T LIE
of merchants did not change their prices
of merchants actually increased prices
of merchants actually did what they said they would
amount merchants have pocketed since the Durbin Amendment was implemented
JUST A FEW OF THEIR BROKEN PROMISES
“Consumers are on the verge of getting a great windfall. If this law goes into effect as planned and the fee is lowered — that will be a savings of a billion dollars a month.”
–Mallory Duncan, SVP and General Counsel, National Retail Federation
“There’s no doubt the majority of it (the savings from the Durbin Amendment) would go through in consumer savings.”
–Douglas Kantor of Steptoe & Johnson, LLP, on Behalf of The National Association Of Convenience Stores, The Society of Independent Gasoline Marketers Of America, and The Merchants Payments Coalition
“Given the hotly competitive nature of retailing in the United States, it is a virtual certainty in my mind that the vast majority of that benefit would be passed along to consumers, to our guests and customers of all other retailers.”
–Douglas Scovanner, Executive Vice President and CFO of Target (No longer at Target)
“If fees are cut small businesses will be able to grow their business, pay their employees more, and pass savings along to consumers.”
–Lyle Beckwith, of the National Association of Convenience Stores
“If the transaction costs go down for the merchant, the transaction costs for the consumers are going to go down as well . . . It ought to go down by an amount essentially identical to the amount that the merchants’ transaction fee goes down.”
–Matthew Shay, President and CEO, National Retail Federation
A survey by the Richmond Fed shows that more than three-fourths of merchants did not change their prices after the Durbin Amendment was implemented, and 22 percent of merchants actually increased prices. Amazingly, just 1 percent of merchants reduced prices after the Durbin Amendment was implemented.
In other words, the overwhelming majority of merchants have not passed along to consumers their $42 billion (and counting) windfall that they received as a byproduct of the Durbin Amendment.
Independent research verifies this: for example, researchers at the University of Chicago examined whether merchants passed savings on to consumers in the form of lower prices and better services and concluded that consumers ended up worse off than they were before the Durbin Amendment was implemented.